Unmask The Truth In Licensing Webinar

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Kevin Gillis, Vice President of Network Management for Ipswitch discusses differences in IT management licensing between WhatsUp Gold and Solarwinds with insight from ex-Solarwinds customer Brian …

Kevin Gillis, Vice President of Network Management for Ipswitch discusses differences in IT management licensing between WhatsUp Gold and Solarwinds with insight from ex-Solarwinds customer Brian Harrell, Network Engineer from the Judson Independent School District.

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  • Single biggest variable is estimating “how much” the software is used through one or more “scale” factors Simple scale factors e.g. Sales automation application licensed by number of sales staff Pro: Can be directly associated with delivered value Makes each sales person more productive Pro: Easier to plan growth and budgets Directly linked to hiring plan Complex scale factors e.g. Sales automation application licensed by amount of data stored Con: Hard to associated with delivered value How many of the records are real leads? Con: Not easy to plan growth and budgets How many records will we have next quarter? Next year?
  • Total number of managed network interfaces including switch ports, physical interfaces, virtual interfaces, sub-interfaces, VLANs, etc. Economic of Software Licensing: The greater of… Interfaces, Nodes or Volumes!!! Guess who wins in this situation – the Vendor!!!
  • Total number of managed network interfaces including switch ports, physical interfaces, virtual interfaces, sub-interfaces, VLANs, etc. The greater of… Interfaces, Nodes or Volumes!!! Guess who wins in this situation – the Vendor!!!
  • Total number of managed network interfaces including switch ports, physical interfaces, virtual interfaces, sub-interfaces, VLANs, etc. The greater of… Interfaces, Nodes or Volumes!!! Guess who wins in this situation – the Vendor!!!

Transcript

  • 1. Unmask the Truth in IT Management Licensing Kevin Gillis, VP Product Management Ipswitch Network Management Division Brian Harrell, Network Engineer Judson Independent School District
  • 2. Thanks for joining us today. One of you will be the lucky winner of a brand new Amazon Kindle!
  • 3. Basics of Commercial Software Licensing
    • Grant of right-of-use to customers and end users based on mutually agreed terms and conditions
    • The Intellectual Property (IP), outright ownership of the underlying code is never transferred
    • Terms and conditions typically include:
      • Price of license and support/upgrades (annual cost)
      • The how, where, by whom and how much the software is used
      • License duration (e.g. 1 year)
  • 4. The Perils of Software Licensing That’s great! You’re in their budget until the end of time now! Yeah…those guys at ACME had no clue on the software license… Two Software Sales Guys
  • 5. Economics of Software Licensing Customer and Vendor Win: License price and “real” customer value is well matched Customer Wins: Vendor charges less than real customer value delivered Value / Price Amount (Scale) of Software Use Vendor Wins: Vendor charges more than real customer value delivered Fairly Priced
  • 6. How Does This Play Out in Real Life? Customer tries to negotiate price down: To levels closer or below their “perceived” value Vendor tries to push up “perceived” customer value: To support internal customer justification to pay more Value / Price Amount (Scale) of Software Use
  • 7. Variable Factors in Software Pricing
    • Single biggest variable is estimating “how much” the software is used through one or more “scale” factors
      • Simple scale factors
        • e.g. Sales tool licensed by seats (number of sales staff)
          • Pro: Can be directly associated with delivered value
          • Pro: Easier to plan growth and budgets
      • Complex scale factors
        • e.g. Sales tool licensed by amount of data stored
          • Con: Hard to associate with delivered value
          • Con: Poor visibility in planning growth and budgets
      • Complex scale factors try to push up ‘perceived value’
      • more than ‘real’ value
  • 8. Licensing Practices in IT Management Simple ‘Scale’ Factors Complex ‘Scale’ Factors Number of devices, systems (physical and virtual) and applications managed Number of device sub-components monitored e.g. interfaces, managed objects Number of separate products with distinct capabilities installed Number of product sub-components e.g. reports, data volumes Number of administrative users Number of monitored metrics e.g. performance counters, alerts Number of view-only users Tiered pricing by device size and type Level of Support (8/5, 16/5, 24/7) Location-restricted licensing Business unit-restricted licensing Node-locked licensing e.g. tied to machine MAC address Size of host machine e.g. #CPU’s “ Named User” restricted licensing
  • 9. Licensing Practices Unmasked Product Sub-Components Reporting Engine Processing Engine Collection Engine Data Store Reporting Collection Engine Processing Engine Integrated Product – One Single License and Price Componentized Product – Multiple Licenses and Pricing Data Store
  • 10. Licensing Practices Unmasked Monitor Based Device Based Licensing – each device comes with unlimited monitors
    • CPU Monitor
    • Memory Monitor
    • Disk Monitor
    • Network I/O Monitor
    • Transaction Monitor
    • Unlimited for one price
    • Critical SQL Services/Params
    • Reporting Services
    • Max SQL Server Page Buffers
    • Cache Usage on SQL Server
    • Wait Locks on SQL Server
    • Unlimited for one price
    Monitor Based Licensing – each with a different license and price CPU Monitor Memory Monitor Disk Monitor Network I/O Monitor Transaction Monitor (s) Critical SQL Services/Params Max SQL Server Page Buffers Cache Usage on SQL Server Wait Locks on SQL Server Reporting Services
  • 11. Licensing Practices Unmasked Element Based 6 Cisco 6500 Switches = 1,000’s of Elements Element-Based Licensing – 100's or 1000’s of element licenses and scaled pricing Each Cisco 6500 series switch can scale from 10’s to 1000’s  of elements with up to 1152 ports per switch   6 Cisco 6500 Switches = 6 Devices Device Based Licensing – one single license regardless of the number of ports and physical or virtual interfaces configured
  • 12. Licensing Practices Unmasked Element Based 6 Cisco 6500 Switches = 1,000’s of Elements Element-Based Licensing – 100's or 1000’s of element licenses and scaled pricing Each Cisco 6500 series switch can scale from 10’s to 1000’s  of elements with up to 1152 ports per switch   6 Cisco 6500 Switches = 6 Devices Device Based Licensing – one single license regardless of the number of ports and physical or virtual interfaces configured
  • 13. Economics of Software Licensing Customer and Vendor Win: License price and “real” customer value is well matched with Device Based Licensing Value / Price Amount (Scale) of Software Use Vendor Wins: Vendor charges more than real customer value delivered with Element or Monitor Licensing Fairly Priced
  • 14. Licensing Practices Unmasked Tiered Devices Flat Device Licensing – Charges for 2 routers One price for all sizes of devices Tiered Device Licensing – Charges for a Small Tier Device and a Mid Tier Device . Each device is charged at separate license rates … simple and direct … complex and indirect A Company Office 1. Cisco 891 Branch Office Router 2. Cisco 7600 Series Router Cisco 891 Branch Office Router Cisco 7600 Series Router
  • 15. Licensing Practices Unmasked Restricted Use Licensing Free Use Licensing As long as it is used by the purchasing customer organization Restricted Use Licensing The right to use the software (license) is limited by the number of concurrent users and/or location Location Based: Limit to the number of concurrent users – typically within a single business unit. Concurrent Users: Use anywhere, but limits are set on the number of concurrent users. Node-Locked: Typically USB key or Mac address lock the license to a particular computer. 1 2 3
  • 16. Comparative Case Study in Licensing WhatsUp Gold Solarwinds Big 4 Vendors Simple, direct device / system / application based licensing Complex, “element based” licensing e.g. interfaces, ports, logical volumes and monitors Complex, “element based” licensing e.g. interfaces, ports and monitors Applications included Pay for each monitor used Applications not included Single tier of device pricing regardless of size of server or router or switch, etc. Element based licensing inherently scales pricing by device size Complex, multi-tiered pricing based on device and system size over and above element count No user based licensing No user based licensing Administrative and “view –only” user licensing Agentless Agentless Expensive. Agents are extra
  • 17. The Downside of Element-Based Licensing
    • Charges for device and managed sub-component or “element”
    • Hard to know which elements to start with
    • Difficult to project how the deployment will grow over time
    • Fewer monitors are deployed – potentially leading to inadequate coverage
    • Quickly becomes expensive, as you monitor more elements
    • Inevitably, idle ports are monitored (wasted investment)
    • Priced to push all customers to higher-priced enterprise level licensing
  • 18. License Cost Comparison Device vs. Element Based Licensing WhatsUp Gold (Device-Based) Solarwinds (Element & Monitor Based) 200 network devices - 2,400 elements based on 12 interfaces per device 200 servers - 2,000 monitors based on 10 monitored elements per server including resources and applications 200 network devices - 2,400 elements based on 12 interfaces per device 200 servers - 2,000 monitors based on 10 monitored elements per server including resources and applications Total Device Count is 400 Total License Count is 400 Total Device Count is 400 Total License Count is 4,400 (2,400 + 2,000)
    • Licenses Required:
    • WhatsUp Gold Premium Edition $5,195
    • Application monitoring included $0
    • Licenses Required:
    • Orion NPM Enterprise License $20,975
    • Orion APM Enterprise License $19,995
    Total Cost w/ 1 Year Maintenance: $5,195 Total Cost w/ 1 Year Maintenance: $40,970
  • 19. Buying Element Based Licensing is like…
    • Buying your dinner one bow tie pasta….at a time
    Solarwinds WhatsUp Gold
  • 20. The Licensing Need to Know List
    • Remember to calculate the true 3 year licensing and maintenance support of a product before purchasing
      • Discounts offered in year 1 don’t usually carry over
      • Lock in discounts on multi-year service agreements if you can
    • Simpler Licensing = Simpler Management
      • With unlimited elements you don’t have to work or waste time counting, tracking or load balancing to stay in compliance
      • Price links directly to value
    • Apples to apples comparison on features…make sure you look at what’s included and what’s additional….
    • If you need a calculator or a dictionary to understand the licensing, it’s probably too complex!
    • Do your homework. There are vendors that provide real value with straightforward licensing.
  • 21. Real Customer Example
    • Introducing Brian Harrell, Network Engineer at the Judson Independent School District in San Antonio, TX
    • JISD Facts
      • 20,000 students
      • 3,200 staff
      • 30 locations
      • 400+ network, servers and applications under management
      • Initially selected Solarwinds – used it for a year and then switched to WhatsUp Gold. Let’s find out why.
  • 22. Next Steps
    • Visit WhatsUp Gold and try our new Cost Comparison Calculator
    • Download our Licensing Practices in IT Management – A Primer
    • See how WhatsUp Gold compares to Solarwinds Orion in our whitepaper Ipswitch WhatsUp Gold vs. Solarwinds Orion Comparing Product Offerings
    • Visit http://www.whatsupgold.com/compare/
  • 23.
    • The 2nd Webinar in the Need to Know Webinar Series
      • on March 25, 2010 at 10 AM EDT
      • The New Breed of SMB Infrastructure Management
    • The 3rd Webinar in the Need to Know Webinar Series
      • on March 31, 2010 at 10 AM EDT or April 1, 2010 at 2 PM EDT
      • Power Forward with the All New WhatsUp Gold 14.2
      • Featuring WhatsUp Gold WhatsVirtual & WhatsUp Gold Failover Manager
  • 24. Questions?
  • 25. www.whatsupgold.com Ipswitch WhatsUp Gold